Pilgrim's Pride Corporation

Good morning and welcome to the second quarter of 2025 Programme Stride on the Conscience Call and Webcast. All participants will be in the listening mode. Should you need assistance, please signal and conscience specialist by pressing the star key followed by 0. At the company's request, this call is being recorded. Please note that the slides referenced during the previous call are available for download from the Invest Affection of the company's website at .pillgrims.com. After today's presentation, there will be an opportunity to ask questions. I would now like to turn the Conscience Call over to Andrew Rogeski, Head of Strategy, Investing Relations and Sustainability for Pillsgrim's PAD. Please go ahead.

Good morning and thank you for joining us today as we review our operating and financial results for the second quarter ended on June 29, 2025. Yesterday I put in a leadership press release providing an overview of our financial performance for the quarter, including a reconciliation of any non-GAP measures we may discuss. A copy of the release is available on our website at .pillgrims.com along with slides for reference. These items also have been filed as form 8 page and are available online at SEC.gov. Fabio Sandri, President and Chief Executive Officer and Matt Galioni, Chief Financial Officer, will present on today's call. Before we begin our prepared remarks, I would like to remind everyone of our safe harbor disclaimer. Today's call may contain certain forward-looking statements that represent our outlook and current expectations as of the day of this release. Other additional factors not anticipated by management may cause actual results to differ materially from those projected in the forward-looking statements. Further information concerning these factors has been provided in yesterday's press release, our form 10-K and our regular filings with the SEC. I would now like to turn the call over to Fabio Sandri.

Thank you, Andy. Good morning everyone and thank you for joining us today. For the second quarter of 2025, we reported net revenues of 4.8 billion, a .3% increase over the same quarter last year. Our adjusted EBITDA was 687 million, up .7% versus Q2 of 2024. Our adjusted EBITDA margin was .4% in line with last year. Our performance reflects our commitment to our values, disciplined execution of our strategies, and extensive application of our management metrics. In the US, our diversified fresh portfolio across segments benefited from favorable commodity clear house values, continued affordability of choosing compared to other fruitings, strong key customer demand, and sustained progress in operational excellence. Diversification efforts through prepared, accelerated, as our branded offerings continue to drive growth across retail and for service. Our euro business rose margin expansion through realization of cost efficiencies in manufacturing and optimization of product mix. Safe to key customers rose faster than channel averages, and our branded offerings in fleet raiders and rollover continue to grow, further diversifying our portfolio. Mexico shows strong results, giving attractive fundamentals in the commodity market, extensive growth with key customers, and continued momentum of branded offerings in fresh and prepared. Given the strong demand, along with our vision of becoming the best and most respected, we are pleased to announce the initial wave of investments to further unlock our growth potential. We have also announced a special dividend of approximately $500 million. As a result, we can continue to create better features for our team members, bolster our competitors' advantages, and further unlock value for our shareholders. Time to supply in the US, the USDA indicated relatively quick production for the US chicken that grew .9% compared to the second quarter of 2024, from increased headcount and higher than average driveway. Despite an increase in excess with a more productive layer flock, cheap placements continue to be challenged as hatchability remains at historical low levels and hatcher utilization continues at record rates. As such, production growth was driven by increased light weight and improved livability during the later half of the quarter, expanding production by the 1.9%. Considering the most recent sets and placements data, the USDA estimates growth of .5% in 2025, suggesting sufficient supply to meet strong chicken demand experienced in recent orders. As for overall protein availability, the USDA anticipates .3% for 2025 growth, as increased chicken and pork production offset significant declines in beef production. As for demand, the cost of eating out continues to increase more rapidly than eating at home. As such, retail propels further growth for chicken. In fresh, both tenders and wings gain traction, whereas boneless chicken's dress continues to grow, giving continued record spread against ground beef. Momentum for boneless thighs continues as it grew faster than all cuts compared to prior years. Similar to fresh, both the deli and frozen department also had a demand at a sustainable rate. Frozen fully cooked led chicken growth across all of detail primarily through increased velocity, whereas deli benefited from increased distribution and demand for wings. In food service, the increase in the cost of eating out impacted restaurant traffic, especially for food service restaurants. However, chicken demand grew as operators strategically lean into value offerings, limited price production, promotion, and menu revisions to either trigger or maintain momentum. Value-added chicken focus QSR continues to leverage the affordability of chicken, outperforming the broader dining sector and capturing traffic and share. In exports, broiler volume continues to lag previous years. Nonetheless, pricing remains resilient as domestic demand for dark meat continues to be healthy. Given the relatively minimal outbreak of high-fat agent influenza, many of our trading partners continue to ease or remove trading restrictions on several major poultry producing subspace, increasing the access. While opportunities arise from trade restrictions from the outbreak of high-fat AI in Brazil, the overall impact was muted as export markets quickly adjusted to different policies and restrictions across countries. Our trading partners continue to navigate tariffs. To date, there have been no significant disruptions other than China. We anticipate potential benefits to U.S. chicken when a trade agreement is reached between these countries. Turning to feed, corn pricing moved lower throughout the quarter, as the U.S. saw a large rebound in plain third-A bridge. As a result, the USDA forecasted a record high in U.S. corn production, along with a re-use in domestic stocks. When combined with increased production from Brazil, the USDA expects global corn stocks to be relatively flat here on the world rear. Soybean meal pricing also moves lower, as records found American production drove a sharp rise in global soybean stocks. When combined with increased soybean processing capacity for biofuels worldwide, meal prices have become further depressed. In wheat, global stocks, including China, are expecting a slight rebuild this crop year, as production was close to or above initial expectations in all major northern hemispheres. In the UK alone, output increased by 12% compared to prior years. As a result, increased production is expected to offset slightly lower beginning stocks. Since ample supply exists and is more readily available at the point of origin, risks related to physical supply of wheat have been reduced. Throughout the remaining of the year, grain and oil seed markets will take direction based on U.S. weather, anything packed on corn and soy crop yields, along with any possible disruptions related to ongoing trade negotiations. In the US, consumers continue to seek value in their eating occasions. As such, the relative affordability, availability, and flexibility of chicken compared to the other proteins continue to resonate across both retail and food service channels. Given the environment, kids rarely experience strong demand as consumers increasingly migrated towards retail to stress their budgets. This strength was amplified by record stress between boneless, skinless breasts and ground beef pricing. Nonetheless, our differentiated portfolio continued to gain traction as our sales to key customers grew significantly higher than industry averages. In the US, the performance of our branded transfer of fresh operating was particularly strong as net sales rose nearly 20% compared to prior years. In small births, overall margins remained strong as our business benefited from an extensive demand from key customers in USR. In Delhi, wind velocity improved, but we experienced some reduction in the growth of rotisserie birds, impacting prices to a lower level than 2024, but still close to the historical 5-year average. We are working in new innovation to help growth with our key customers on this category. In big birds, jumbo cut-out values remained favorable despite volatility in the quarter. During the first two months, value were second highest on record. After a rapid decline in June, values returned to normal life levels consistent with the 5-year averages. Nevertheless, our team remained focused on operational excellence as youth and labor efficiency both improved. Given our progress in constructive market conditions, profitability increased significantly compared to prior years. Pre-pairs continue to realize significant growth as net sales increased by 20% compared to last year. In retail, just bear recently achieved over 10% market share given incremental distribution and category leading velocity. Pilgrim's momentum also continues to build as trials of loss increase throughout the quarter. Both brands continue to receive industry recognition for innovation and consumer preference. Just bear achieved the number one ranking in Flitano's 2024 product-based sector list, whereas Pilgrims received the People Magazine's 2025 Food Award for Best Chicken Market for our cheesy jalapeno offering. Prepare Foods also continues to drive profitable growth through incremental distribution, portfolio expansion and vended offerings in Pilgrims and Gold Case brands. As such, sales grew over 25% compared to last year. More importantly, substantial opportunities remain with leading distributors, selected USRs and schools. Commerce also continues to be a growth driver as digitally enabled sales rose over 26% compared to last year through continued expansion and efficiency of leading investments with leading retailers, food service providers and various online platforms. Turning to Europe, the environment improved as consumer sentiment grew as rates of space inflation. Within retail, overall demand remained steady across the proteins, with poultry and chur meals experiencing the highest growth, while land and pork were the most challenged. Given this environment, our team continues to drive profitable growth through our strategies. As such, we strengthen key customer relationships through incremental distribution and new product development, generating sales growth that helps pace the overall grocery channel. Our diversification through key brands in retail also continues to progress. Rollover grew over 10% compared to last year from additional distributions and new offerings. -to-lazer also continues to market place momentum as net sales growth surpassed the category average. Innovation remains a key pillar to drive growth. During the quarter, our higher-activity differentiated chicken offerings, developed for a key customer, was recognized as the best new poultry products by food management today. We continue to cultivate our new product pipeline. As such, we've extended our rollover portfolio into chicken, created additional eating occasions for fried fridge raisers to pass again, and worked in close collaboration with the key customers to create a series of premium new epic meal offerings. These items and several others are created for launching Q3 and will be supported by investment in media and promotions to foster growth. Food service remains challenging as total visits fell compared to prior years. We additionally secure awards from our customers, increasing our sales in the channel by 10% versus last year. Moving forward, we will look to further cultivate our presence with food operations within the pubs and bars category. Our integration of corporate support activities and optimization of our manufacturing network are nearing completion. Based on these efforts, we have improved production efficiency and created a more agile, key customer-focused organization. Given our enhanced foundation, we will look to accelerate opportunities to drive profitable growth. Mexico experienced another strong quarter, as commodity fundamentals in the live and retail markets remain attractive, given its analysis, reduced availability of imports, and volume growth. In fresh, key customer relationships strengthen, as net sales increase double digits, driven by the food service rotisserie channel. Our retail fresh branded portfolio also continues to drive diversification, and sales have increased over 6% compared to last year, led by Just There, which is over 2.5 times. Our diversification efforts to value-added have experienced similar success, as prepared continued to grow. In retail, pilgrims' demand increased double digits compared to last year. Growth in the food service was driven by QSR, which were up nearly 10% versus prior years. During our investor day in March, we highlighted a variety of projects to reinforce our strategies and enhance our competitive advantage. As part of this, we announced an investment of $400 million last year to build a new foodie cook prepared food plant in Walker County, Georgia. Given this investment, we can further capitalize on long-term growth trends for chicken in retail and food service. Prepare is a large category, with an estimated size of $14 billion, and a track-six growth profile also exists as net sales have grown annually by 6% since 2019. Furthermore, consumer interest appears to be accelerating, as sales have risen by 7% between the first half of 2024 and 2025. During the same period, our net sales have grown 21%. Momentum for our retail brand has also been remarkably strong. Over the past five years, household penetration has increased from .4% to 10%. Similar momentum exists in food service for our brands, as gold case volume has risen 15% annually since 2021. When our growth prospects are combined with strong consumer enthusiasm for our brands, we have a remarkable opportunity to accelerate the expansion of our prepare food system. This investment will further diversify our portfolio, reduce reliance on outside growth by suppliers, and leverage our fresh production capabilities. As a result, we can drive growth, enhance margins, and reduce volatility across our entire U.S. business. In the meantime, we will expand foodie cook production in our existing prepare facilities at Morefield and Rayco. Given these investments, we will still expect to have sufficient capacity to meet our growing demand across retail and food service. Within retail, over one-third of fresh chicken is sold as antibiotic-free or organic chicken. Given extensive consumer interest, our case-ready business has become the leading provider of these higher attributed, differentiated offerings. To further strengthen our competitive advantage, and reinforce our leadership position, we have announced the conversion of a Big Bird point to support key customer growth to an NIE and veg-fed program in the case-ready segment. We make communities to diversify across world sizes, and our ability to capture markets up-side in the Big Bird commodity market. As such, we view the manufacturing footprint, and identify opportunities to enhance our mix and unlock additional capacity to meet our growth in the -in-bed segment. Given these efforts, we can maintain our current portfolio across all bird sizes, further increasing our upside potential while limiting downside risk. Equally important, we can generate higher, more consistent margins in the low- to mid-level digits for our U.S. fresh food. In Mexico, our capacity extension efforts also continue. Our projects in Vera Cruz and Merida remain on schedule, and we still anticipate this will become operational in the first half of 2026. Similarly, our prepared expansion continues to proceed as planned, and initial production is slated for the beginning of 2026. Given this work, we can continue to drive sales growth and reduce volatility of results. When all these products are at full capacity, we will increase the size of our business in Mexico by 20%. We remain committed to the other key projects and potential strategic acquisitions that are discussed during our investor day. As such, we will continue to evaluate various alternatives and provide the space when available. With that, I would like to ask our CFO, Mark Valvanoni, to discuss our financial results. Thank you, Fabio. Good morning,